High-end real estate market is strengthening
By the numbers:
10: Single-family or duplex listings in Vail Village or Lionshead through Nov. 30
5: Closed sales.
$8 million: Median sale price.
187: Average days on the market.
Source: Vail Board of Realtors.
EAGLE COUNTY — The impact of high-end real estate on the local market far outweighs the number of units changing hands, and some impressive deals have closed in the past few months.
First, the impact:
Land Title Guarantee Company tracks closed sales recorded at the Eagle County Clerk and Recorder’s Office. Through the end of October, there were 37 closed sales in Vail Village, at an average price of just more than $3.4 million.
Those 37 sales accounted for nearly 10 percent of the dollar volume from all the sales in the county. That means it took 1,380 other transactions to make up the remaining 90 percent of the sales volume.
In Beaver Creek, 74 sales accounted for another 10 percent of the $1.3 billion in county real estate sales through the year’s first 10 months.
That means roughly 8 percent of all the county’s real estate sales accounted for just more than 20 percent of the total sales volume.
After a relatively soft 2015, the market for very expensive real estate — priced at $5 million or more — seems to be strengthening in the second half of 2016.
“There are quite a few units under contract right now in the $15 million to $25 million range,” Vail Board of Realtors Board of Directors Chairman Kyle Denton said. “Compared to early (2016), it feels like there’s a little bit more momentum.”
Ron Byrne has spent more than 30 years working in the high end of the Vail Valley real estate market. Byrne said this has been a very good year for his firm.
A couple of Byrne’s clients have purchased lots — existing homes — on Forest Road and Beaver Dam Road. The homes built on those sites will be valued at roughly $25 million each when finished.
While there aren’t many buyers for homes in that part of the market, Byrne described the current high-end market as “bullish.” That activity comes despite a significant downturn in the country’s major stock exchanges in the first weeks of 2016.
That early-year correction didn’t last, of course, and the Dow Jones Industrial Average is now operating in all-time record territory.
That early-year downturn “caused us to have buyers who were very cautious — we didn’t see as much activity in those months,” Byrne said. Throw in the uncertainty surrounding this year’s presidential election, and “everybody hit the pause button,” he added.
Since then, though, there’s been a good bit of interest in the market’s upper reaches.
“We’ve had one of our best years ever,” Byrne said, adding that most of high-end buyers this year are from the United States.
Beyond the slopeside addresses near Vail Village, there’s been activity elsewhere in Vail and Beaver Creek.
Byrne’s firm this year sold a home near Vail’s golf course for more than $14 million, and participated in this year’s highest per-square-foot sale in Beaver Creek.
These and other high-end sales have a couple of things in common. The first, of course, is the oldest three words in real estate: location, location, location.
Denton said the other common factor is modernity.
“These (sales) are either newly built, in the past 10 years, or homes in which sellers have done extensive renovations,” Denton said. “The high-end buyers are heavily attracted to those components.”
Byrne said high-end buyers “will spend a lot if they find what they want. If not, they’ll build it. Some of these homes are just magnificent.”
Although there aren’t many deals in this end of the market, Byrne said he’s seeing people buying, then rebuilding, homes that were first built in the 1980s. One of those homes, the “glass house” on Rockledge Road, was built in the late 1980s, and was controversial at the time. That home recently sold for about $9.5 million, and is being extensively renovated. Again, that home will be valued at $25 million or more when the renovation is complete.
Another home, on Beaver Dam Road, that has recently come on the market was essentially rebuilt from the ground up starting in 2010 or so, Byrne said. That project — and others like it — can often take a couple of years to be completed.
What buyers are doing on the high end of the market is finding a different way of investing their wealth, Byrne said.
“These are lifestyle investments,” Denton said.
“I call it a return on enjoyment,” Byrne said. “I have one client who told me, ‘I get off the plane here and my head starts to clear.’”